Auditing and Assurance Services Chapter 1
Study online at https://quizlet.com/_54ki1c
1. occurrence; existence: As a general rule the ________ assertion relates to events, transactions, presen-
tations and footnote disclosures and the __________ assertion relates to account balances.
2. c. attestation engagement: An audit is a specific type of:
a. assertion
b. explicit representation
c. attestation engagement
d. internal control
3. - provides tax services for key company executives
- consults on "listed" transaction tax strategies
- accepts fees that are based on tax outcomes: The PCAOB prohibits an accounting firm from
providing auditing services to a public company if the accounting firm:
- provides tax services for key company executives
- provides normal tax advice to the company
- consults on "listed" transaction tax strategies
- accepts fees that are based on tax outcomes
4. True: True or False: Understanding management assertions is a key component of planning an audit.
5. - auditing and assurance services are the largest source of revenue for most
of the Big 4 accounting firms
- traditional financial statement audits are the most frequent assurance en-
gagement requested by most medium nonpublic companies: Which of the following
statements are correct?
- The level of auditing activity provided increases as the size of the public accounting firm decreases.
- Auditing and assurance services are the largest source of revenue for most of the Big 4 accounting firms.
- Larger CPA firms usually provide more nonaudit and attestation services for their clients than smaller firms.
- Traditional financial statement audits are the most frequent assurance engagement requested y most medium
nonpublic companies.
6. existence; occurence: The assertions about the actuality of each balance sheet and income statement
balance is ___________, while ______________ asserts that each event and transaction actually happened.
7. - management or human resource services
- financial information system design and implementation
- bookkeeping and related services
- appraisal or valuation services: Services that public accounting firms are prohibited from providing
, Auditing and Assurance Services Chapter 1
Study online at https://quizlet.com/_54ki1c
to audit clients under Sarbanes-Oxley include:
- management or human resource services
- financial information system design and implementation
- tax return preparation advice
- bookkeeping and related services
- appraisal or valuation services
8. attestation engagement: When a practitioner is engaged to issue a report on a subject matter or an
assertion about subject matter that is the responsibility of another party is a(n): _________ _________
9. c. provides tax services to key executives: The PCAOB argues that auditor independence would
be impaired if the firm:
a. provides any type of tax advice to the company
b. prepares the company's corporate tax return
c. provides tax services to key executives
10. - has more task-based activities
- has an increased emphasis on critical thinking: The new CPA exam:
- is now 14 hours instead of 16
- has more task-based activities
- has an increased emphasis on critical thinking
11. - review internal control systems to ensure compliance with company poli-
cies
- review the effectiveness of achieving results compared to established objec-
tives
- perform audits of financial reports for limited external distributions: Internal
auditors:
- review internal control systems to ensure compliance with company policies
- review the effectiveness of achieving results compared to established objectives
- perform audits of financial reports for limited external distribution
- examine evidence and issue an opinion on the fairness of financial statements
12. - internal audit outsourcing
- investment services
- legal and expert services
- actuarial services: Services that public accounting firms are prohibited from providing to audit clients under
Study online at https://quizlet.com/_54ki1c
1. occurrence; existence: As a general rule the ________ assertion relates to events, transactions, presen-
tations and footnote disclosures and the __________ assertion relates to account balances.
2. c. attestation engagement: An audit is a specific type of:
a. assertion
b. explicit representation
c. attestation engagement
d. internal control
3. - provides tax services for key company executives
- consults on "listed" transaction tax strategies
- accepts fees that are based on tax outcomes: The PCAOB prohibits an accounting firm from
providing auditing services to a public company if the accounting firm:
- provides tax services for key company executives
- provides normal tax advice to the company
- consults on "listed" transaction tax strategies
- accepts fees that are based on tax outcomes
4. True: True or False: Understanding management assertions is a key component of planning an audit.
5. - auditing and assurance services are the largest source of revenue for most
of the Big 4 accounting firms
- traditional financial statement audits are the most frequent assurance en-
gagement requested by most medium nonpublic companies: Which of the following
statements are correct?
- The level of auditing activity provided increases as the size of the public accounting firm decreases.
- Auditing and assurance services are the largest source of revenue for most of the Big 4 accounting firms.
- Larger CPA firms usually provide more nonaudit and attestation services for their clients than smaller firms.
- Traditional financial statement audits are the most frequent assurance engagement requested y most medium
nonpublic companies.
6. existence; occurence: The assertions about the actuality of each balance sheet and income statement
balance is ___________, while ______________ asserts that each event and transaction actually happened.
7. - management or human resource services
- financial information system design and implementation
- bookkeeping and related services
- appraisal or valuation services: Services that public accounting firms are prohibited from providing
, Auditing and Assurance Services Chapter 1
Study online at https://quizlet.com/_54ki1c
to audit clients under Sarbanes-Oxley include:
- management or human resource services
- financial information system design and implementation
- tax return preparation advice
- bookkeeping and related services
- appraisal or valuation services
8. attestation engagement: When a practitioner is engaged to issue a report on a subject matter or an
assertion about subject matter that is the responsibility of another party is a(n): _________ _________
9. c. provides tax services to key executives: The PCAOB argues that auditor independence would
be impaired if the firm:
a. provides any type of tax advice to the company
b. prepares the company's corporate tax return
c. provides tax services to key executives
10. - has more task-based activities
- has an increased emphasis on critical thinking: The new CPA exam:
- is now 14 hours instead of 16
- has more task-based activities
- has an increased emphasis on critical thinking
11. - review internal control systems to ensure compliance with company poli-
cies
- review the effectiveness of achieving results compared to established objec-
tives
- perform audits of financial reports for limited external distributions: Internal
auditors:
- review internal control systems to ensure compliance with company policies
- review the effectiveness of achieving results compared to established objectives
- perform audits of financial reports for limited external distribution
- examine evidence and issue an opinion on the fairness of financial statements
12. - internal audit outsourcing
- investment services
- legal and expert services
- actuarial services: Services that public accounting firms are prohibited from providing to audit clients under
